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Chinese honey manufacturer pleads guilty to illegal import scheme

CHICAGO - The president of a Chinese honey manufacturer pleaded guilty Thursday to conspiring to avoid U.S. anti-dumping duties by illegally importing honey that was falsely identified as coming from the Philippines. This guilty plea resulted from an investigation conducted by U.S. Immigration and Customs Enforcement (ICE).

Yong Xiang Yan, 60, pleaded guilty to conspiring to smuggle 15 full container loads of Chinese honey into the United States and avoiding anti-dumping duties of approximately $635,515. Yan admitted that between 2005 and February 2008 he conspired with others - including nine individuals in the United States and Asia, and a German trading company and its subsidiaries in the United States, Beijing and Hong Kong - to illegally import Chinese honey, including adulterated honey, into the United States.

As relevant conduct to be considered at sentencing, Yan acknowledged that he authorized an additional 21 shipments of Chinese honey through the Philippines and Thailand, which entered the United States in the state of Washington. An additional $3.3 million in anti-dumping duties were avoided on these shipments, bringing the total figure avoided to approximately $3,953,515.

Yan is the president of Changge City Jixiang Bee Product Co. Ltd., a honey manufacturer located in Henan, China. He was arrested May 6 in Los Angeles on federal charges filed in Chicago. He has remained in federal custody since his arrest.

According to court documents, some of the Chinese honey Yan shipped to the United States was adulterated with antibiotics, specifically Norfloxacin and Ciprofloxacin, which are banned from domestic foods.

Neither the charges or the plea agreement indicate any instances of illness or other public health consequences attributed to consumption of the honey, nor does it identify any store brands or domestic supply chain of any honey that was illegally imported or adulterated.

Yan pleaded guilty Oct. 29, before U.S. District Judge Wayne Andersen, Northern District of Illinois. Sentencing is scheduled for April 22, 2010. Yan faces a maximum penalty of five years in prison and a $250,000 fine.

"Anyone who mislabels goods imported into the United States defrauds the U.S. government and gains an unfair financial advantage over their competitors," said Gary Hartwig, special agent in charge of the ICE Office of Investigations in Chicago. "ICE investigates criminals who try to circumvent our nation's customs laws to profit illegally. These laws protect U.S. businesses and the American public."

Another Chinese national who was arrested with Yan pleaded guilty in August in Seattle to similar federal charges. Boa Zhong Zhang arranged honey shipments for Yan's company and worked under his supervision. Charges remain pending in Seattle against a third man identified in Yan's plea agreement as Chung Po Liu, of suburban Seattle.

The government is being represented by Assistant U.S. Attorneys Andrew Boutros and William Hogan, Northern District of Illinois.

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